Latest CRM fireside - Paul Redstone - Solica

This month’s interview is with Paul Redstone Managing Director of Tonbridge-based CRM reseller Solica Consulting Ltd

RB - Paul can you introduce yourself and how you first became involved with the CRM market place?

PR - I’m a serial entrepreneur. I worked for Logica for many years, before moving sectors and building up a pharmaceutical services business which we grew from two of us to 100 people in four years. It was within that business that I started using CRM technology actively. Then, when we sold the company and my lock-in expired, I retired for two years, got bored and started Solica combining skills in business and CRM.

RB - Can you give me some background about Solica?

We’re a pure CRM company, we don’t do anything else. Our main business is reselling CRM products and our main products are Goldmine, ACT, and Sage CRM. We have around 100 customers, based mostly in the UK but also overseas. We also have a niche business developing add-ons for these products, particularly for Goldmine which we sell mostly via resellers. We also re-sell and incorporate other company’s add-ons in our solutions, for example Inaport for integration services.

RB - How would you differentiate Solica as a reseller?

PR - The main area is in applying our expertise in the business side, particularly in the early phases of a project. We have grey hairs (or in my case not so many grey hairs these days!), and we aim to get inside our clients business, understand what they do and speak their language. That’s very important to ending up with a successful solution.

RB - There’s a trend amongst resellers towards selling both front office and back office solutions, do you see yourself heading in that direction?

PR - I think we will stay with the CRM side and there are two main reasons for that; the first is that there are very different skills and cultures involved in putting in a CRM system and an accounting system. The second reason is in terms of market potential: there is probably only 20% penetration of CRM systems in small and medium size enterprises, whereas with accounting systems there is near enough 100% penetration.

RB - You’ve been selling CRM systems for the last eight years, how do you see the market having changed in that time?

PR - When we started out there was a lot of educating clients about why they needed CRM. Even though that still applies to some extent, more commonly now people know that they need a CRM system. Clients are also expecting more from systems; eight years ago you could put in a system with very little configuration and no integration that would meet expectations. Now most systems have some level of integration, for example with accounts systems or web sites, and clients want to implement much more sophisticated solutions.

RB - What sort of changes are you seeing in the reseller community and people’s approaches to reselling CRM software?

PR - I think that as a market matures you are not selling a product but a solution. To sell a solution you need a portfolio of different technologies to meet different needs, so you are seeing resellers taking on a broader range of CRM software. Vendors who stick with one product only tend not to survive. There’s also a trend to putting together much more complex solutions composed of products and components from multiple vendors.

RB - Goldmine is what you started with and remains one of your core offerings, what made you select Goldmine?

PR - We nearly took on ACT, but decided at the time (8 years ago) that ACT wouldn’t meet the needs of some of the clients we were talking to. We found Goldmine a more extensible, configurable solution - in fact I think the gap between them has converged somewhat over recent years, as indeed have CRM systems from many different companies. Goldmine has excellent out-of-the-box capabilities and is sufficiently configurable to meet the needs of a large proportion of the clients we work with.

RB – FrontRange (the developers of Goldmine), I would imagine rather controversially, recently dropped support for their entry level version – Goldmine Standard Edition - how was that move perceived and how has it impacted you?

PR – We, and many other resellers, were very unhappy with that. Even though the market that the Standard Edition was targeted towards was relatively small for us, it was important because often a small initial system would develop into a large one later. If you are trying to meet a whole range of client needs you need a low end solution and that’s the reason we’ve now taken on ACT. Actually though, it’s had less impact for our business than we might have expected. If you look at the cost of CRM project, though the total costs of a Goldmine based solution have now risen by perhaps 30-50% at the five user level, clients have been prepared still to pay that – in most cases. The fact that other lower end solutions have also crept up in price has also helped.

RB - Over the years there’s been a raft of analyst reports indicating clients haven’t felt high levels of satisfaction with their CRM systems, do you think that’s something that’s got better with time, or is that still an issue?

PR – I think it has improved, at least in the business to business sector (most of our clients are B2B) where the core benefits of CRM are realised by just performing business processes more efficiently and better – not through some of the more subtle functions such as clever targeting which are more common in business to consumer applications. In many ways a CRM is to manual methods like a car is to a bicycle: both get you there but the car is faster and lets you go to places which would not be feasible on a bicycle. The core economic justication is in going faster and saving effort and costs, which is easier to quantify, rather than ‘better’ customer interaction.

RB - What do you see as the key challenges of implementing CRM technologies?

PR - Mostly it’s to do with business acceptance and integrating business processes. If the CRM is imposed on users and they don’t see the benefits, you won’t succeed. You have to get users buy-in and the failure to get this is the most common reason systems fail. There are, of course, challenges around selecting the right technology, and more importantly implementing it in the right way. It is also vital to remember that a CRM should evolve and probably evolve rapidly. A CRM is not like an accounting system, where the processes are well understood and largely static, and you could come back to a system five years after implementing it and find nothing’s changed. In CRM applications in marketing, sales and customer support business processes are much more fluid. CRM systems which work well initially will often fail later if they do not evolve – they become disconnected from the changed business processes.

RB - If you were sat with a client what’s the main advice you would give them about implementing CRM technology?

PR - Understand the motivation of end users and give them something that makes them want to use the CRM. Be rigorous about focusing on the key benefits of the system; sometimes clients get too hung up on areas that will have only minor impact, and don’t focus on the core potential benefits.

RB - What advice would you give about selecting the right technology or vendor?

PR - Those are two different aspects: from a technology perspective, try and define your requirements in as much detail as possible, and find the simplest technology that meets both your current and future needs. Also, involve the users in making the selection to maximize their buy-in. From a vendor or reseller perspective, ensure they have a depth of expertise with that solution and ensure there is a good cultural fit.

RB - Finally, what do you wish CRM software developers did better than they do now?

PR - I think key things are responding to developments in the market a little bit more quickly, I don’t think they respond to feedback from resellers or users as quick as they could do. And perhaps also not being radical enough in their development.

Why work with an independent CRM consultant...

Well the new white paper is finally up on the site. The title changed from the original working title to the rather more it does what it says on the tin one of ‘Why work with an independent CRM consultant?’ The paper can be downloaded here or the copy is displayed below. The objective was to try and succinctly address two key market misconceptions:

Misconception 1 – that working with a CRM vendor alone is likely to produce a profit enhancing system

Micsconception 2 – that the role of the independent consultant is limited to vendor or technology selection

To the extent we’ve succeeded, we’ll let you be the judge:

Why work with an independent CRM consultant?

Introduction

If you’ve ever worked for a software company, or know someone who has, then you’ll be well aware how much pressure software vendors are under to hit their sales targets. As the end of each financial quarter looms the stress of making the numbers increases. Those that succeed are well rewarded - companies through higher market valuations and profits, and individuals through commissions, bonuses and stock options. For those that fail, markets and employers are unforgiving.

Against this background, it’s perhaps no surprise that the software world is rife with hype, half-truths, and pushy salespeople desperate to close the deal. These commercial realities go part way to explain why many organizations have struggled to realize significant value from their investments in CRM technology. The Gartner Group famously noted that 65% of CRM implementations failed to meet expectations, and this gloomy assessment is supported by a raft of other analyst reports. However the good news is that we know from experience that those who get it right can use CRM technology to very significantly increase performance and profitability.

While CRM projects fail for a variety of reasons, the gap between the vendor’s goal of ‘selling’ software and the user’s objective of generating value from their technology investment can often be an unbridgeable chasm. The CRM consultant, perhaps more traditionally associated with software selection, is increasingly taking on a much broader role from project conception to delivery, to bridge the gap between raw CRM technology and profit creation for the client. This paper sets out how CRM consultants are helping organisations deliver considerably more from their CRM systems.


Unlocking the potential

The CRM consultant can play a key role in defining the initial compelling vision which sets out how CRM technology can significantly improve business performance

Identifying how CRM can benefit an organization is not always as obvious as it might seem. From our own experience, we’ve found many of the key profit generating aspects of the projects we work on weren’t necessarily envisaged before we became involved. The CRM consultant can play a key role in unlocking the potential of a project. By drawing on their experience and analysis skills the consultant can identify the achievable ways in which CRM technology can generate the greatest returns for each client. This articulation of the vision can in turn help secure the backing and resources that are generally essential for project success.


Building the foundations for success

Involving a CRM consultant in the early stages is a very cost effective way of ensuring everyone goes into the project with a full understanding of what’s involved and that the project is resourced for success

Great CRM projects don’t just happen, they require good planning to limit the risks and maximize the returns. While it may be tempting to rush into purchasing a system, this can result in having to live with the wrong technology (or vendor), or failing to implement the system in a way that yields positive business benefit. Effective planning doesn’t have to be time consuming, and experienced consultants can quickly help clients formulate a solid business case, identify key functional requirements, suitable technologies, reliable vendors, and perhaps most importantly help with project budgeting. A lot of organizations over-pay for systems, while many others under-budget and fail to achieve their goals through lack of resources.


Making the right choice for you

With choice comes both opportunity and risk, nothing will destroy a project quicker than picking the wrong technology or implementation partner. The CRM consultant will continue to play a vital role in helping companies work with the best CRM technologies and partners

There’s never been a wider range of CRM software available. Enterprise vendors have extended their offerings to small and mid-sized companies, the array of software as a service (SAAS) providers ever increases, Microsoft continues to make its CRM presence felt, and open source vendors are having a growing impact. This complexity of choice is amplified by the fact that many software packages are sold through a network of resellers and implementation companies, some of whom are top-flight, but many of which are mediocre, and a significant few are downright incompetent.

The key is to make a selection that’s right for you. What works for one organization may not work for another, even though they might be outwardly similar businesses. An implementation partner who might work perfectly with one type of project, may struggle with a different approach. The cornerstone to effective vendor selection is to define and document detailed requirements before entering the selection process. This enables you to identify which product best meets your needs, provides a basis to compare pricing from competing vendors, and significantly speeds up the downstream implementation.

The requirements gathering process can be difficult simply because unless you are well versed in the nuances of CRM technology, it can be challenging to identify what’s likely to be important to you when you ultimately become a user of the system – you don’t, after all, know what you don’t know. A consultant can use their experience to short-cut a potentially highly time-consuming activity and quickly deliver a set of requirements that will form the basis for effective vendor selection.

The vendor selection stage is traditionally where CRM consultants are often most visibly involved in a project (though we hope this paper clarifies how CRM consultants generate client profitability through a much broader range of activities). While the ultimate purchase decision will always be the client’s, the CRM consultant can ensure that they are selecting from the most appropriate technologies and vendors for their needs and budgetary aspirations. The consultant can often make considerable savings at this stage by ensuring the client isn’t paying for unnecessary bells and whistles, on the basis there’s little point in purchasing a top of the range system if the requirement is amply met by a more cost effective application.


Negotiating the right price

The CRM consultant can generally create very significant cost savings for their clients through their involvement in the negotiation of pricing and terms

While many of our clients are skilled negotiators, the CRM consultant can generally help them negotiate more effectively through our knowledge of vendor margins and historical precedent. Where an experienced consultant can add significant value is their ability to review implementation estimates and identify where savings can be made in the number of man days to deliver a project. It is not uncommon for us to reduce the overall cost of a project by over 30%, allowing our clients to achieve considerably more with their budgets. A consultant can also assess vendor contractual terms and identify potential pit-falls which can result in substantial savings over the life of the business relationship.


Navigating the perils of CRM implementation

Well conceived projects can still founder during the implementation process. The CRM consultant can perform a critical function in ensuring that the system delivers the anticipated benefits

The CRM implementation process can be a rich source of pit-falls that can de-rail a project. Areas such as process and system design, data imports and integration, user acceptance testing, and user adoption can be demanding in the hands of a skilled practitioner and particularly perilous for those undertaking a project for the first time. Users on the other hand can be particularly unforgiving, and if a project fails to deliver what they were expecting, when they were expecting it, it can prove extremely taxing to gain their support.

The CRM consultant can ensure the delivery of the CRM vision, by either acting as an advisor to the client project team (many of whom may not have worked with CRM technology previously), or by performing the project management function. This involvement can significantly reduce the burden on the project team and considerably reduces the risk of project slippage or budget overruns.


Reviving existing systems

The CRM consultant can play a key role in achieving greater value from existing systems. For those contemplating replacing a system, the consultant can play an important role in independently assessing the continued viability of the existing technology

While outright project failures are a rarer phenomenon these days, a lot of CRM deployments fail to generate the anticipated returns on investment. For most organizations the instinct is to purchase new technology, however many systems can be revived without the cost of buying new CRM software. A consultant can give an independent assessment as to whether a system is salvageable, and if so, can quickly identify how the technology can produce higher operational value. The consultant can also diagnose why a project has failed and can help the client avoid the costly repetition of past errors. There is often considerable hidden value, even within successful systems, and a consultant can generally find ways to significantly increase the returns from any existing CRM investment.


In Summary

The CRM consultant can add significant value through the whole chain of a CRM deployment from initial analysis through to delivery of a live profit enhancing system and its onward development. While it might be assumed that selecting the right vendor is all that’s required to be successful, the vendors are generally focused and resourced to sell software not deliver client value. The independent CRM consultant, with no software to sell, is becoming an increasingly important catalyst in delivering CRM technology’s long overdue potential. © Mareeba Ltd 2007.

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Eating my own dog food...

I’ve been heavily involved in taking a number of systems live over the last few months – hence the paucity of blog posts. One key thing I did learn was the importance of eating your own dog-food. Short of resource with the live date looming we ended up in all hands to the pump mode keying a pile of information into the system to ensure that the users had all their data to hand in the new system. If you spend long enough performing heavy data entry duties you quickly identify those irritating areas that are unnecessarily mouse click or key board intensive. While we take a lot of trouble to work with vendors to design a system that’s as ergonomic as possible, sometimes the drawing board doesn’t quite translate to real life. User acceptance testing will pick up many of these problems, but if you really want to check you’ve done a good job there’s nothing to beat living the life of the user for a while.

Unlocking the potential of CRM technology...

I'm just finishing up on a revised white paper. The title will be something along the lines of 'Unlocking the potential of CRM technology - and the role of the independent CRM consultant'. The traditional perception of the CRM consultant is that our focus is on vendor selection activities. In reality our engagements tend to be much broader, and vendor selection while a key component, is just one in a number of aspects designed to deliver a more fundamental goal of increasing the bottom line value of CRM technology. I've tried to keep the paper as brief as possible without it becoming just a long list of bullet points. I've included an excerpt from the introduction below, and I'll publish the full paper later in the week, potentially with a punchier title - if I can think of one!


Introduction

If you’ve ever worked for a software company, or know someone who has, then you’ll be well aware how much pressure software vendors are under to hit their sales targets. As each financial quarter looms the stress of making the numbers increases. Those that succeed are well rewarded - companies through higher market valuations and profits, and individuals through commissions, bonuses and stock options. For those that fail, markets and employers are unforgiving.

Against this background, it’s perhaps no surprise that the software world is rife with hype, half-truths, and pushy salespeople desperate to close the deal. These commercial realities go part way to explain why many organizations have struggled to realize significant value from their investments in CRM technology. The Gartner Group famously noted that 65% of CRM implementations failed to meet expectations, and this gloomy assessment is supported by a raft of other analyst reports. However the good news is that we know from our own experience that those who get it right can use CRM technology to very significantly increase performance and profitability.

While CRM projects fail for a variety of reasons, the gap between the vendor’s goal of ‘selling’ software and the user’s objective of generating value from their technology investment can often be an unbridgeable chasm. The CRM consultant, perhaps more traditionally associated with software selection, is increasingly taking on a much broader role from project conception to delivery, to bridge the gap between raw CRM technology and profit creation for the client. This paper sets out how CRM consultants are helping organisations now deliver considerably more from their CRM systems.